TPG unlimited ads found to be misleading

TPG's "unlimited" $29.99 plans were misleading because they failed to account for line rental, the Federal Court has ruled.

The competition watchdog, the Australian Competition and Consumer Commission (ACCC) took TPG to court over the ads for its $29.99 plan at the end of last year, claiming that the ads failed to disclose the full cost of the plan. It was unsuccessful in seeking an interlocutory injunction against the advertising last year; however, on Friday, Justice Bernard Murphy ruled in the Federal Court in Melbourne against the telco.

Murphy found that although TPG advertised the unlimited plan for $29.99, it did not adequately disclose that the cost was $59.99 per month including line rental.

"It is an unfair trade practice to require consumers to find their way through to the truth past advertising stratagems, which have the effect of misleading or being likely to mislead them," Murphy said in his judgment.

ACCC chair Rod Sims said that the ruling served as a warning to telcos to be up front with customers about the total costs of plans.

"Telecommunications companies must include clear and accurate information for consumers in their advertisements, and this should provide a further warning to the telecommunications industry that they must get their advertisements right," Sims said in a statement.

In a statement, TPG general counsel Tony Moffatt said that the telco was disappointed and surprised by the court ruling.

"TPG believed that its advertisements did sufficiently and prominently disclose both the single price and the requirement for bundling, particularly having regard to similar advertisements being published," said Moffatt. "The interpretation of 'prominence' is something which has not previously considered by the Courts in Australia, and we are disappointed with this result."

Moffatt said TPG is considering its options.

Penalties for the case are set to be determined at a directions hearing next week.